Leeham News and Analysis
There's more to real news than a news release.
There's more to real news than a news release.
Aviation Traffic Paralyzed by Iran Conflict
Managing Editor, AIN
March 2, 2026, © AIN: Business aircraft operations across the Gulf region remained paralyzed on Monday as airspace and airports remained closed due to the ongoing military conflict between Iran and U.S. and Israeli forces. While the impact on airline services remains far greater, the business aviation sector appeared to have few options to exercise its usual flexibility to evacuate aircraft, crew, and passengers.
The full story may be found here.
I wonder how long this will continue.
One dreads to think what the aviation consequences will look like if this war drags on for months/years, like previous wars in the region.
The Big Three in the gulf won’t be able to sit this out for long.
And, with elevated fuel prices, other airlines won’t be too happy, either.
Turkey had a drone incident today, so Cyprus isn’t the only country in the eastern Med to be affected.
Just one downed airliner will have a drastic effect on consumer appetite to fly anywhere in/near this extremely important aviation region.
What a mess!
You can fly around Iran. ( traffic into/outoff Iran is limited anyway?)
And Emirates seems busy delivering stranded passengers to Germany.
Shipping is much more of an issue.
30% of global fossil fuels apparently have to pass through the Strait of Hormuz.
Repatriating stranded passengers in Dubai, Abu Dhabi and Doha is just a tiny trickle of the Gulf carriers’ normal activity.
And seeing as those 3 cities are each just 100-200 km from Iran, with approach routes over the Persian Gulf and Gulf of Oman, it’s doubtful that normal hub operations from those cities will be re-commencing any time soon. Every time I’ve flown between the Gulf and Europe, the flight path passed over a significant portion of western Iran (stunning mountainous scenery), Kuwait and Iraq. More recent routes instead cross over the Arabian peninsula and the Sinai…but they still have to land/originate very close to the Iranian coast.
Other large carriers with hubs somewhat further from the cauldron — such as Turkish, and maybe Saudia and Air India — may see increased traffic going forward, since they can steer further out of harm’s way. And direct carriers between Europe and Asia can also more easily avoid the area. But those carriers can’t absorb the lost daily volume of the Big Three Gulf carriers.
There are reports that the terminal at Dubai Airport was struck, and passengers rushed to evacuate. There are four casualties IIRC
OTOH the FT reports those who live and/or work there are considering to leave
> FT: Dubai evacuation costs rise as high as $250,000 as more families flee
> “Half of Dubai is booking”
I wonder what’s the medium-term impact to the ME3 since they account for what — 70% to 80% of the backlog of the 777x. My theory is that there was balance of power, that existed (though not perfectly) and at least peace was maintained. Now that balance was shattered. It might, in a less than optimistic scenario, reminiscent of what happened in 1979, which caused persistent disruptions and high(er) crude prices. That was an era that today’s ME3 didn’t exist. So it’s difficult to model the impacts. But my fear is there’s a lack of sufficient care and planning exercised before the go ahead was given at 15:38 Friday Feb 27. They only started to figure things out after the sxxt hit the fan.
> COPENHAGEN, March 4 (Reuters) – Maersk said on Wednesday it is temporarily suspending most cargo bookings in and out of the United Arab Emirates, Oman, Iraq, Kuwait, Qatar, Bahrain and Saudi Arabia until further notice.
There are implications once the inventory there starts to run low!
> Report: Air freight prices to US jumped 60% yesterday!
> Report: Gas(oline) prices went up again overnigh
+ 1
That’s a good point about the 777X backlog.
Not only are the ME3 losing essentially all daily revenue at the moment, but their governments are also bleeding lost income from energy exports and tourism. Concurrently, they’re grappling with increased outlay for defense and many imported basics. Moreover, the economies of these countries depend on expats — who, as you point out, are starting to pack their bags.
A large (older) portion of the Gulf’s 777X backlog can be canceled without penalty…
Dubay airport in 1979
My first fly (AF 747) to Manilla was allowed to land for refuelling in Teheran
Second fly (AF 747) had to land in Dubai (Teheran closed) due to damaged right wing not permitted to fly further
AF personnel 1 or 2 guys had to reroute me and all AF passenger from an antique airport terminal … just a shed full of local travellers and goats !!!
I arrived to Manilla one day late after a stopover in Bangkok (due to travellers leading to Hong Kong and other asian cities)
To my knowledge all mostly European companies had to land in Dubai to help rerouting AF passengers
Good old days :=))
@Uwe
The reality that the neighboring countries are unable to operate their economies right now is a strong reason why this war is not likely to continue “at its current pace” indefinetely. These are economies that will break without petro revenue. Iran is funded with petro revenue…and China ultimately is supplied with Gulf oil.
CNBC: “The U.S. insists the Iran conflict won’t be a ‘forever war.’ Experts beg to differ”
https://www.cnbc.com/2026/03/05/iran-conflict-duration-middle-east-regional-war-experts.html
More risks in supply chain disruption:
March 5th: “Since Operation Epic Fury, today is by far the stage for the wildest and most aggressive increases in gasoline, diesel and jet fuel prices. Wholesale gasoline up 13-28cts/gal; diesel up 30-34cts/gal; jet fuel up 70cts/gal in some markets and over $4/gal in most markets.”
> Dubai Airports operates 1,140 flights in 84 hours amid disruptions.
In an update shared on social media, Dubai Airports said the flights were handled through Dubai International Airport and Al Maktoum International Airport between March 2 and March 5.
> NYTimes: “More than 20,000 flights to or from the Middle East have been canceled since Saturday. Stranded travelers say they’ve had to improvise expensive, often complex plans to get home … Many said they received no help rebooking flights or paying for hotels.”
> Dubai has only 10 days left in supply of fresh produce?
The by far hugest issue is the coming humanitarian crisis.
Aviation travel is for the better offs, not the people all over the Gulf who are going to be affected. They don’t and or can’t fly.
They do need food and water.
Many await the China response and how it will effect the war and aircraft operations. Will China like in Korea roll in with missiles and soldiers? This to protect its oil import from Iran. China knows that a high oil price will mostly benefit the US oil companies and their sponsored politicians.
China can take more crude and natural gas from Russia’s eastern pipelines/ports, and it has a large strategic reserve…so its situation is not as pressing as some might think.
The US actually has a larger problem: within a few days, prices at the pumps are going to hit levels not seen in years…which is not what the current administration wants in an election year.
https://www.bloomberg.com/news/newsletters/2026-03-05/oil-prices-energy-dominance-won-t-stop-us-fuel-costs-pushing-higher
It’s unlikely that China will get directly involved…much more likely that it will operate behind the scenes.
It might deploy its navy to escort Chinese shipping through the international waters of the Persian Gulf, though that would probably cause tension with the US.
China has a diversified energy supply, supplemented by an expanding renewable sector that pushed to lower its carbon emissions since early 2024. It has proven the resilience and its long-term strategy of diversification and self-sufficiency.
If Iran conflict pushes up energy prices for a longer period, demand will grow for clean energy. China is the world’s leading producer of this technology.
Qatar aluminum plant, a major producer, has shut production down. Who else is both a major producer and exporter? The phones start to ring off the hook!
Yes, the oil and gas problem might push countries to invest heavily in wind and solar power that quickly can come on-line, also retiring older thirsty aircrafts quicker like the 767; 757 and 777-200. The country that can deliver solar and windpower quickly is China… The US want to increase Russian oil exports. When Ukraine see the resources US release to help Israel attack Iran for its own reasons and compare the support they get defending against Russia they feel the difference and Europe note as well.
27% of China’s daily oil usage transited the Strait of Hormuz in 2025.
Only 2% for the US. China most certainly has a problem.
Back in June 2022, the inflation adjusted average price of gas in the US was $5.65 per gallon. In Jan 2026 it was $3.21. We’ve got a ways to go before the prices “hit levels not seen in years”
“Qatar Airways schedules special flights to European cities from Muscat and Riyadh”
“Qatar Airways launched a series of limited relief flights this March 5 from Muscat and Riyadh to support passengers stranded by the temporary suspension of its regular operations. The decision follows the closure of Qatari airspace mandated by local authorities due to the current regional situation.
“The emergency flight schedule includes services from Muscat International Airport to London-Heathrow, Berlin, Copenhagen, Madrid, Rome, and Amsterdam. Additionally, the carrier scheduled a link from Riyadh to Frankfurt. These operations are limited in scope and aim to mitigate the impact of the contingency on users within the airline’s global network.”
“The airline requested that affected passengers avoid traveling to airports unless they receive an official notification with their assigned itinerary details. “The safety and wellbeing of our passengers and crew remains our highest priority,” the company stated. “We apologise for the disruption caused by circumstances beyond our control due to the temporary airspace closure,” they added.
“Travelers must keep their contact information updated via the official website or mobile app to receive instructions regarding travel options and the next steps for rescheduling their journeys.”
https://www.aviacionline.com/english/commercial-aviation/middle-east/qatar-airways-schedules-special-flights-to-european-cities-from-muscat-and-riyadh_a69a9836184d236b20835b9b9
“Jet fuel prices surge to record highs on supply disruption fears”
“Jet fuel prices have climbed to record levels across major global markets amid concerns over supply disruptions, according to S&P Global Platts on Thursday.
“Singapore jet fuel prices reached an all-time high of $231.42 per barrel on Wednesday, driven by global supply concerns.
“In Northwest Europe, jet fuel prices rose to $1,259.75 per metric ton, marking the highest level since the start of the Russia-Ukraine war.
“The U.S. Gulf Coast pipeline jet fuel benchmark increased 11.4% to 348.63 cents per gallon, representing the highest level since October 2022.”
https://www.investing.com/news/commodities-news/jet-fuel-prices-surge-to-record-highs-on-supply-disruption-fears-93CH-4543489